In June the Trustee Leadership Forum for Retirement Security, a project of the IRI, held its sixth annual convening at the Harvard Kennedy School. Pension trustees gathered for three days of discussion, diving into questions of long-termism and alignment of interests as they apply to working people and their pension fund investments.
While there is a well-recognized and growing need for increased levels of long-term investment in infrastructure in United States, there is a lack of appropriate mechanisms for matching that need with long-term investment capital seeking sustainability outcomes alongside risk-adjusted returns. Sustainable infrastructure investments often do not yield the kind of high, near-term return on investment typically needed to attract private development capital, but the long-term return profile of many infrastructure investments aligns well with the portfolio targets of many pension funds and similar “patient” capital.
To help us think through this challenge of matching capital to need in responsible infrastructure investment, the IRI is pleased to welcome a new Senior Research Fellow, Waide Warner. Waide will be working on a project to explore the development of a sustainable infrastructure investment platform to engage pension funds and foundations in the financing of infrastructure projects with environmental and social benefits. Waide is also a Senior Counsel of Davis Polk & Wardwell, an international law firm based in New York. As a partner at Davis Polk for more than 25 years, he led the project finance group, advising on a broad range of U.S. and international financings, restructurings, and joint ventures in the telecommunications, transportation and power sectors across the Americas, Europe, Asia and Africa. From 2014 to 2016, he was an Advanced Leadership Fellow at Harvard University. He holds a bachelor’s degree in Sociology from Boston College, did graduate work in Sociology at the University of Chicago and received a law degree from Rutgers Law School.
Last week, the Department of Labor announced that it was withdrawing a guidance memo from 2008 for ERISA plans on Economically Targeted Investments (ETIs), reverting instead to previous guidance issued in 1994. This move had been long sought by a substantial group of responsible investors, who shared the DOL’s concern that the 2008 guidance “unduly discouraged fiduciaries from considering ETIs and ESG factors” when making their investment decisions.
This is big news in the IRI’s neck of the woods. ERISA not only governs a sizable number of pension funds directly, but it has even broader impact as a touchstone for asset owners who aren’t subject to the legislation.